I saw this more closely than most. Within a single extraordinary fortnight, I went from serving Liz Truss’ first Chancellor Kwasi Kwarteng to working with his successor Jeremy Hunt, moving from the budget that blew up the bond markets to the one built to calm them.
Few advisers get to serve a chancellor who detonates a budget, as well as the one brought in to steady the ship only days later. And there is no better crash course in the life cycle of a budget: the whispers, the over-interpretation, the panic, the denial and the sudden transformation of every think tanker with a spreadsheet into a clairvoyant.
Once that ambiguity takes hold, human nature does the rest. We aren’t built to tolerate secrets. Tell people they will hear nothing until a fixed date, and every stray comment starts to glow with imagined significance. A throwaway remark from a minister becomes a coded signal; an economist’s speculative prediction on X becomes an afternoon of fiscal sleuthing.
But the problem isn’t journalism or the widespread speculation, it’s a system that asks the country to stare at a locked door for months and then expresses surprise when people try the handle. And when you can see the real-world consequences — from hiring freezes and delayed investment decisions to families cutting back their groceries — watching the country whip itself into a frenzy over phantom tax measures isn’t charming.
Inside the Treasury, meanwhile, things look stranger still. Budgets appear to be grand set pieces, but the real action begins six weeks earlier, with the Office for Budget Responsibility’s (OBR) first forecast. Hidden inside is the number everyone fixates on: the sacred “headroom.” In theory, this figure shows what the chancellor can spend without breaching her fiscal rules. In practice, it behaves like musical chairs, constantly shifting until the music stops and everyone solemnly treats the final figure as destiny despite the fact that it is based on projections five years out — as though pandemics, wars and global shocks politely submit advance notice.
During one budget under Hunt, for example, the initial OBR forecast suggested we might have extra breathing space. A senior official murmured: “We might be able to do something interesting” — which, in Treasury culture, counts as reckless hedonism. Then, only days later, gilt yields twitched, growth was revised down, and the headroom shrank like a wool sweater in a boil wash. Outside commentators insisted the chancellor had changed strategy, while it was simply the arithmetic tightening its grip.